Economy

United Kingdom inflation jumps again as petrol pushes prices higher

United Kingdom inflation jumps again as petrol pushes prices higher”

Ben Brettell, senior economist at Hargreaves Lansdown, said it looked likely inflation would fall back in the coming months, as the effect of Brexit-induced sterling weakness fell out of the year-on-year calculation.

"Wage growth is modest - wages are rising at around 2 per cent year-on-year depending on the measure you choose".

Sterling jumped more than half a percent against both the dollar and euro on Tuesday after United Kingdom inflation rose to its highest in five years, adding to the case for the Bank of England to do more to support the pound. The prices charged by companies at the factory gate rose in August at an annual rate of 3.4%, while the cost of firms' raw materials rose 7.6%, fueled by increasing crude oil prices.

The yield on the benchmark 10-year gilts, jumped 3 basis points to 1.07 percent, the super-long 30-year bond yields climbed 2-1/2 basis points to 1.72 percent and the yield on the short-term 2-year traded almost 1-1/2 basis points higher at 0.23 percent by 09:15 GMT. Clothing and footwear rose 4.6 percent year-on-year, hitting their highest level since records began, partly because of rising import costs for retailers in the wake of Brexit. It also gained against the euro, following a strong start to the day against its peers ahead of the release of figures. The month of August registered 2.9% inflation on the year up from the previous 2.6% reading and bypassing the 2.8% forecast. "However it still remains to be seen if the dovish majority at the BoE can be persuaded that the latest rise in inflation necessitates a more hawkish policy".

"Indeed it is possible that 2.9% will be the highest we see in the current cycle".

The Bank is predicting CPI to peak at around 3% in October, with Governor Mark Carney warning last month that the pressure on families would continue for the next few quarters.

CPIH rose to 2.9% in August from 2.6% in July and against expectations of 2.8%, while Core CPI rose to 2.7% from 2.4% beating expectations of 2.5%.

The pickup in inflation, from a 2.6% annual rate in July, was larger than economists polled by The Wall Street Journal were expecting.

Calum Bennie, savings expert at Scottish Friendly, said: "Family finances are going to be stretched for some time to come and the increase in inflation just exacerbates this".

"However, hopefully this will not be at the expense of putting money aside for their financial future".



Like this

Latest


12 September 2017
Harry Styles Drops by BBC Radio 1 for a Live Lounge Performance
Their Live Lounge has been rescheduled for Wednesday (September 13). "I'm a massive fan of them as a band and the music". Harry Styles doing a live cover of " The Chain " by Fleetwood Mac is probably the coolest thing you will hear all week.

12 September 2017
Wenger never contemplated United move due to love of Arsenal's 'values'
Danny Welbeck started in place of Alexis Sanchez, who had to travel back to London from global duty with Chile. One day maybe I will get all the contacts I had during my stay at Arsenal and it would make a few chapters.

12 September 2017
SoFi CEO Forced Out Over Sexual Harassment Allegations
Previous year the company funded $3.1 billion in loans, earning an adjusted profit of $61.6 million on $134 million in revenue. He added that the concentration of the officials shifted more towards the litigations especially on me personally.

12 September 2017
Pep Guardiola, Manchester City players react to Premier League win against Liverpool
Guardiola joked it would make the Brazilian "more beautiful" and said the injury would probably not sideline him for very long. Man City: Ederson , Walker, Stones, Otamendi, Mendy, Danilo, Fernandinho, De Bruyne, Silva (c), Aguero and Jesus.

12 September 2017
Alleged Star Wars Battlefront 2 beta details emerge
It reveals that you'll be able to play on PC, PS4, and Xbox One, and that the download will be somewhere between 14-16 GB. With the Star Wars Battlefront II beta fast approaching, fans like myself are eager for all the details we can get.

12 September 2017
House prices slow in London
The highest rate of growth in the country was in the Cotswolds, where house prices have soared 16.2pc in the 12 months to July. Among the English regions, prices went up fastest in the east Midlands at 7.5%, followed by the east of England at 7.1%.

12 September 2017
Ronda Rousey In Plans For Survivor Series 2017, WrestleMania 34
If all goes as planned, Rousey and her teammates would be involved in 2017 Survivor Series and WrestleMania 34. Even though Nikki Bella might say she wants to fight Ronda Rousey , it doesn't look like those are WWE's plans.

12 September 2017
Clovis Oncology, Inc. (NASDAQ:CLVS) Trading Volume Significantly Higher
Following the transaction, the insider now directly owns 197,583 shares in the company, valued at approximately $18,090,699.48. Shell Asset Management Co. purchased a new stake in shares of Clovis Oncology during the 1st quarter valued at about $489,000.

12 September 2017
Destiny 2: September 12 Weekly Reset Guide
Each Tuesday's reset therefore serves as the deadline to finish the Nightfall, Meditations, and the Raid (once that's available). The Nightfall this week appears to be a bit easier this time around, simply due to the familiarity of the Strike itself.

12 September 2017
Oppo A71 smartphone launched in India at Rs 12990
The Oppo F3 comes with a 5.5-inch full HD (1080x1920 pixel resolution) In-Cell display and 2.0mm thin screen bezels. On the camera front, the A71 is mounted with 13MP rear camera with f/2.2 aperture, PDAF and LED Flash.



Recommended